Use the Figure Below to Answer the Following Questions

question 116

Multiple Choice

Use the figure below to answer the following questions.

Figure 19.3.5
-Refer to Figure 19.3.5. This figure shows the labour supply curves and the value of marginal product curves for high-skilled and low-skilled workers. If the labour markets are competitive, then for a 40-hour work week, high-skilled workers must be paid

• A)an extra $3 to compensate for the cost of acquiring their human capital and for their increased productivity.
• B)an extra $20 to compensate for the cost of acquiring their human capital and for their increased productivity.
• C)an extra $120 to compensate for the cost of acquiring their human capital and for their increased productivity.
• D)an extra $300 to compensate for the cost of acquiring their human capital and for their enhanced productivity.
• E)an extra $180 to compensate for the cost of acquiring their human capital and for their increased productivity.

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Definitions:

Trading Securities

Financial assets such as stocks and bonds held by an investor with the intent of selling them in the short term to profit from price fluctuations.

Unrealized Gains

Profits that have been achieved on paper due to an investment increasing in value but have not yet been cashed in by selling the asset.

Fair Value

A measurement of the price at which an asset or liability could be exchanged in an orderly transaction between market participants at the measurement date.

Held-To-Maturity Securities

Held-to-maturity securities are financial assets purchased with the intent and ability to hold them until a specified maturity date, typically including certain kinds of bonds.